A tale of 2 US employment surveys, at a glance

Published on NewsOK Modified: May 2, 2014 at 4:34 pm •  Published: May 2, 2014
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The U.S. economy added a whopping 288,000 jobs in April, the biggest monthly gain in more than two years. And the unemployment rate fell to a 5½ year low of 6.3 percent from 6.7 percent.

But the drop in the unemployment rate had nothing to do with more people getting jobs.

Wait, what? Didn't the rate fall because of all the new jobs?

Actually, no. The jobs report is based on two separate surveys, and they sometimes produce very different results. The job count comes from a survey of businesses. The unemployment rate is compiled from a survey of households.

The business survey asks mostly large companies, nonprofits and government agencies how many people they employed during the month. For April, the payroll survey showed that companies and government agencies added 288,000 jobs.

In the household survey, government workers ask whether the adults in a household have a job. Those who don't are asked whether they're looking for one. If they are, they're considered unemployed. If they aren't looking for a job, they're not considered part of the workforce and are not counted as unemployed. The household survey produces each month's unemployment rate.

In April, the household survey showed that far fewer people began job hunts than is typically so. Most people who start looking for work don't immediately find jobs. So an increase in job-seekers usually boosts the number of unemployed.

But because fewer people started looking for work in April, the number of unemployed fell by 733,000. That lowered the unemployment rate.